The industrial production index increased for the first time last month after five consecutive months of contraction, the Ministry of Economic Affairs said yesterday.
According to data compiled by the ministry, industrial output increased 6.38 percent from June and 2.07 percent from a year earlier, Yang Kuei-hsien (楊貴顯), deputy director-general of the ministry’s statistics department, told a press conference.
Production in the manufacturing sector — which accounts for more than 90 percent of total factory output — grew 5.81 percent month-on-month and 2 percent year-on-year last month, also ending five straight months of contraction, a statement by the ministry showed.
“The industrial output last month indeed achieved an annual growth after dropping for nearly half a year,” Yang said.
“However, it may be hard to sustain the annual increase this month, given a higher base last year,” he added.
As the US and Japanese economies are gradually recovering from recession and the overall economic condition in Europe has improved, industrial production is likely to maintain its growth momentum in the near term, the ministry said.
However, uncertainties such as the US Federal Reserve’s plan to halt its bond-buying program and China’s weakening domestic demand may hinder the nation’s export growth, it added.
With the launch of new handheld devices and growing demand for goods and services ahead of China’s National Day holiday in October, electronic component output is expected to continue growing this month, Yang said.
Increased steel production ahead of annual maintenance for steel mills and the scheduled start of CPC Corp, Taiwan’s (CPC, 台灣中油) cracker expansion should also help sustain annual growth in manufacturing output, he added.
Driven by strong demand, chips used in mid-end and entry-level mobile devices and electronic component production last month increased 6.47 percent month-on-month and 4.68 per year-on-year.
However, because of weaker-than-expected demand for high-end smartphones and decreased orders for televisions, electronics and optical products’ output last month dropped 5.22 percent month-on-month and 14 percent year-on-year, the ministry said.
Chemical material production last month increased 4.23 percent month-on-month and 6.66 percent year-on-year due to a rebound in crude oil prices and a lower base last year, while output in the basic metal sector grew 5.87 percent month-on-month and 11.56 percent year-on-year as companies raised production ahead of their plants’ annual maintenance.
According to the ministry’s survey, 46.9 percent of local manufacturers forecast industrial production this month would increase, and 49.4 percent forecast that the market value of the total output would grow this month.
Separately, the ministry yesterday said that wholesale, retail and restaurant sales dropped 0.7 percent year-on-year to NT$1.2 trillion (US$40.51 billion) last month.
The ministry attributed the decline to lukewarm demand for PCs and a higher base last year.
For this month, the ministry forecast sales in the domestic commercial sector would remain flat, despite August being a peak season for the tourism and restaurant businesses.
Other factors include the earlier start this year of the Ghost Month, which affected auto sales, the ministry said.
According to the ministry’s survey, about 49.2 percent of firms forecast sales in the domestic commercial sector would increase this month.
HEAVY INVESTMENT: Moody’s affirmed the firm’s ‘Aa3’ rating with a ‘stable’ outlook due to its leading position in the industry and ability to match customer requirements Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) revenue this year is expected to increase about 21 percent to NT$1.29 trillion (US$44.01 billion) from NT$1.07 trillion last year, driven by strong demand for advanced 5-nanometer and 7-nanometer chips mainly used in smartphones and high-performance computing devices, a Moody’s Investors Service report on Wednesday said. TSMC’s rate of revenue growth next year is to increase to 7.5 percent, the ratings agency said. The company, which supplies 5-nanometer chips for Apple Inc’s new iPad series, has introduced the advanced chips ahead of its competitors and gained a significant share of the market for the foundry industry’s
Shin Kong Financial Holding Co (新光金控) yesterday said that its insurance unit would adjust its investment portfolio after being banned from buying new stocks a day earlier by the Financial Supervisory Commission (FSC). “We will research what we can do based on the commission’s specific instructions after we receive the regulator’s formal documents,” Shin Kong Financial spokesman Sunny Hsu (徐順鋆) told the Taipei Times by telephone. The commission on Tuesday fined Shin Kong Life Insurance Co (新光人壽) NT$27.6 million (US$941,722) for reckless investment, and demanded that the insurer reduce its overseas investment ratio from 43 percent to 39 percent. The fine would affect
Taipei Times: When do you think the hospitality industry can return to how it was before the COVID-19 pandemic? How does Formosa International Hotels Group (FIH, 晶華酒店集團) fare this quarter and beyond? FIH chairman Steve Pan (潘思亮): The virus outbreak will have a serious impact on business travel, driven mainly by meetings, incentive travel, conferences and exhibitions over the past three decades. For the past six months, many businesspeople have grown used to exchanging information on the Internet, where more people can participate. The trend might sustain for three to five years until people are vaccinated and it is safe to
DIGITAL COMMERCE: In 2016, only 2 percent of orders were delivered in Taiwan, but that has risen to 10 percent, Foodpanda Taiwan Co operations director Nick Yu said Online food delivery platforms have seen explosive growth in Taiwan this year, helped by business opportunities related to the COVID-19 pandemic, company executives said at a digital commerce conference in Taipei yesterday. When the threat of COVID-19 kept people from going out to eat, more people experimented with ordering food deliveries online, Foodpanda Taiwan Co Ltd (富胖達) operations director Nick Yu (余岳勳) said. Foodpanda started operations in Taiwan in 2012. “We experienced 5,000 percent growth in the past 24 months,” Yu said. “That’s more than the previous six years combined.” In 2016, only 2 percent of food orders were delivered in Taiwan, but that